December 18, 2010

Air Asia Philippines to Fly in August 2011

Sorry Cebu Pacific, but it seems that there will be another “Juan” that would be dotting the Philippine skies soon.

Air Asia, the world’s largest budget carrier, has recently struck a deal with Filipino businessmen to form an affiliate in the Philippines. The first Air Asia Philippines flight is expected to take off by August of 2011. No pronouncement has been made yet if the new carrier will be using the Ninoy Aquino International Airport (NAIA) Terminal 3 as its hub in the country. Reports say that the company is considering either Subic or Clark as its base.

Air Asia currently uses the Diosdado Macapagal International Airport for its Clark-Kuala Lumpur and Kota Kinabalu flights.

The news of Air Asia Philippines’ entry elates many Filipino travelers, especially backpackers, since Air Asia is known for its very cheap airfares. Just last year, I was able to book a flight to Kuala Lumpur for only PhP 1068 (all in)! I wouldn’t be surprised if the cost of a Hong Kong trip next year will be cheaper than the regular Royce Chocolate box that I usually buy for Gin on our monthsaries :)

The deal between Air Asia boss Tony Fernandez and his Filipino counterparts, led by Antonio Cojuangco, comes at a time when the Philippine government is seriously mulling in opening the country’s skies to foreign carriers. The local air industry has recently been plagued by a serious labor dispute that threatened to ground Philippine Airlines. President Benigno Aquino III has been very vocal and consistent in expressing his interest in adopting an open skies policy to ensure that all routes will be served sufficiently.

While Air Asia Philippines’ entry in the country will definitely benefit passengers, there are concerns that it might cause the downsizing, or even the closure, of some local players. Philippine Airlines had admitted a few months back that it is losing its dominance in the market to budget carriers. In order to keep up with the trend in the industry, PAL owner Lucio Tan recently launched his own budget airline, Airphil Express.

Even though I’m for open skies, I wouldn’t want the country’s local carriers to fold up. But there’s reasonable ground to believe that there’s plenty of room for other carriers to fly around Philippine skies. As Tony Fernandez had opined, the market in the Philippines is very small compared to what it should be. The operation of Air Asia Philippines is also expected to haul in more tourists to the country’s scenic spots which many believe are not being advertised aggressively abroad by the local carriers and the Department of Tourism.